How to Avoid Rental Scams When Browsing for Your New Loft

The internet is an invaluable resource for finding an excellent loft rental, and with the rise of COVID-19, people are increasingly dependent upon it to help out in the search. 

While many online rental sources are legitimate, those who partake in rental scams find that the internet is a great resource to conduct “business,” too, as they can easily stay anonymous. It’s no surprise that the Better Business Bureau has reported a rise in rental scams from coast to coast in cities throughout the U.S., ever since the pandemic hit. 

If you’re searching for a loft, it’s vital to educate yourself about rental scams. Let’s say you’re looking for Los Angeles apartments or lofts, or generally rental in areas with high competition. Speed is of the essence, but being patient and taking your time to investigate your options can actually save you money in the end, by protecting you from scams. 

In this guide, we’ll help you understand what a rental scam is, explain some common types of rental scams, and give you some red flags on how to spot one. We’ll also give you some tips on what you can do to protect yourself and how to report a scam if you come across one.

What is a Rental Scam? 

According to the FTC, a rental scam is an operation where a dishonest person poses as a landlord or property manager to extort money from individuals looking for a rental property. There are a couple of ways scammers accomplish this goal. 

Types of Rental Scams and Where You’ll Find Them 

You’ll commonly find rental scams online on local buy/sell/trade sites or sites like Craigslist, where there is little to no way of verifying that the listing is legitimate.  

The three most common types of rental scams are phantom rentals, hijacked ads, and illegal subletting. 

Phantom Rentals 

Phantom rentals are just what the name implies: listing a property that doesn’t exist or isn’t for rent. Often, these types of listings feature curiously low rental rates or unexpectedly attractive amenities (or both). A sense of urgency often accompanies this kind of scam to convince you that you’ll lose out on a great deal if you don’t commit or send money to secure the property.  

If a listing seems too good to be true, investigate further. Find out why there are discrepancies in the rental rates and amenities. If possible, pay a visit to the address and see it for yourself.

Hijacked Ads 

Sometimes a scammer will revise the information from a legitimately advertised rental to misdirect you. They’ll change the contact information on the ad such that when you call or email to inquire, you’ll reach them instead of the legitimate lister. Scammers have been known to obtain access to property owners’ email accounts to contact potential renters as well.

If you’re interested in an advertisement for a loft rental, do a little research online to verify that its listing is connected to a service confirmed as legitimate. (We’ll talk about how to do this a little later in this post.) When you do reach out to inquire about it, validate that who you’re speaking with is the landlord or property management service. 


Illegal Subletting

Illegal subletting is a complicated scam to spot because the person often has access to the property and will more than likely show you around. Still, they’re not the legitimate owner or property manager and therefore have no authority to provide a contract or collect money from you. Again, avoiding an illegal subletting situation could be as simple as taking a minute to validate who owns and manages the property. 

How to Spot a Rental Scam

There are several red flags to look for when it comes to identifying a rental scam:

  • The listing seems unprofessional.

Listings small on details about the property but big on spelling typos and grammatical errors are a pretty good indication you may have a scam on your hands. Reputable ads should be thoughtfully written by a professional familiar with listing rental properties and should feature plenty of information about the listing.

  • They refuse to meet with you face-to-face.

A legitimate renter will want to meet you in person to show you the property, or if they’re cautious over the pandemic, meet in a video chat. This gives them a chance to develop rapport, evaluate you as a potential tenant, and establish mutual trust. 

If you’ve been communicating with someone about a property who refuses to show their face, it should serve as a big red flag that something is amiss. 

  • They don’t ask for an application, background, or credit check.

Undergoing a screening process is standard procedure when renting any kind of property! If your potential landlord doesn’t ask you to submit an application to rent, consent for a credit check, or consent to run a background check for the property you’re considering, it could be cause for concern. 

A legitimate property owner will require a rental application and have a thorough process to vet each of their tenants.

  • They do ask for a credit check- but want you to pay for it on a referral website. 

Some scammers will refer you to a credit screening company online, often through a link they’ll send in an email, where you’ll be asked to pay for the credit check with a credit card.   

The hook is that these independent credit screening companies pay commissions for referrals. Hence, the dishonest individuals posing as landlords earn money for sending them business- even though they don’t have a property to rent to you in the first place!

  • They ask you to wire money up-front. 

Some scammers will require you to wire them money up-front as a “deposit” before you’ve even signed anything. A typical scenario for this transaction is when an individual indicates they’re out of the country and they promise to send you a key as soon as you wire the money.

This is not how a legitimate rental transaction operates, so don’t pay anyone anything without a lease signed by both parties outlining your rental’s legal terms and conditions.  Obtaining a receipt for your deposit is never a bad idea, either!

Tips on How to Avoid a Rental Scam

  • Do a reverse google search. 

If you run across a listing that seems too good to be true, conduct a reverse Google image search of the address to verify whether the listing pops up under different names, on various websites, or with conflicting information. 

If the listing is legitimate, a quick search should lead you to the property manager or leasing agent’s website with details that match the original ad. If they don’t, it may be a scam, and you should report it.  

  • Meet the landlord, see the loft, and ask questions! 

Get some facetime with the landlord and see the loft in-person or virtually before you sign any paperwork. Often, this is the first line of defense against rental scams, and you should trust your gut if something seems off. 

Make a list of questions you have about the property, the neighborhood, etc. Ask about maintenance procedure, payment details, policies regarding any amenities related to the loft- anything you can think of to make your meeting productive, and take note of the answers you receive. If anything seems less than transparent, it may be time to dig a little deeper or look elsewhere.  

  • Use websites with verified listings when conducting a rental search. 

Some internet listing services display listings for lofts and single-family rentals that are 100% verified and come straight from property management companies, not properties rented by individual owners. 

Property management company websites are also a good bet for browsing safely. There you’ll find plenty of details about the rentals that are offered through the management company. 

  • Get it all in writing. 

Don’t send anyone money before you’ve reviewed the contract containing the rental terms, prices, extra fees, maintenance policies, etc. After you’ve determined the property is legit and run by a reputable company, only then should you sign anything and submit your down payment and applicable fees. Don’t forget to get a copy for yourself, too.

Reporting Rental Scams 

If you come across a potential rental scam, or worse, you’ve become a victim, contact your local law enforcement agency. Since many rental scams occur on the web, it’s a good idea to send a report to the IC3 (Internet Crime Complaint Center). The IC3 is equipped to work with the FBI in taking down any illegal activity on the internet, including rental scams. 


Take Good Care

There are plenty of ways moving can be fun. The prospect of a new neighborhood and all the fun things it has to offer, a new space in which to make yourself comfortable, meeting great new neighbors- the possibilities are exciting! 

But remember, many scammers will use that excitement as leverage to conduct their business by pressuring you to commit. They’ll try to convince you that you’ll lose out on what could be a great deal if you don’t act now. 

Stay aware, proceed with caution, use your gut instincts, and look for the red flags we’ve outlined in this post. If you run across any of them, cut contact, and don’t be afraid to report them to the proper authorities. Not only is it better to be safe than sorry, but you could be saving others from falling victim and losing money because of a rental scam. 

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